'Indian e-commerce market to account for 2.5% of GDP by 2030'

Mumbai, May 6: The e-commerce market will account for 2.5 per cent of the India's GDP by 2030, growing 15 times and reaching USD 300 billion, a report said on Wednesday, May 6.

The current market size of e-commerce is USD 20 billion.

The report by Goldman Sachs cited the "hyper growth in affordable smartphones, improving infrastructure, and a propensity to transact online," as key growth factors.

"Further, India's attractive demographics  the youngest population in the world  should lead to over 300 million new online shoppers in the next 15 years, making e-tailing the largest online segment," it said.

India will have the second-largest digital population in the world with 1 billion users by 2030, powered by online mobile penetration, it added.

"India has enough spectrum and telecom infrastructure to provide 3G data coverage to 25-30 per cent of the population," it said, adding that "further, 3G-enabled smart phones are available for USD 40 with more than 900 phones launches last year".

The payment landscape is also evolving fast with the launch of digital wallets and payment banks, despite 60 per cent of e-commerce transactions in cash-on-delivery mode, the report pointed out.

"Logistics and infrastructure are bottlenecks, but also indirect drivers for online adoption," it added.

Over USD 6 billion of private funding has come into India in 2014 and "significant funds are still waiting, implying a potent eco-system is in place," according to the report.